The Secretary of State to the Acting Secretary of State
1053. Kosmos 14. Eyes Only for Acheson from Marshall. Reference my 978, March 24,1 I wish to have Ambassador Smith call on Molotov immediately and re-state the situation regarding the Soviet failure to reply to our request for the commencement of negotiations regarding the settlement of Lend-Lease. He would repeat his previous statements to Molotov and stress the fact that now, as he had foretold, the political issue in the United States and public opinion demand definite action, either on the part of the Soviet Government or of our government. I would like him to conclude by stating that if the Soviet Government, within a definite number of days, does not make a satisfactory reply regarding Lend-Lease negotiations, the Administration would be forced to recommend that the United States declare the Soviet Government in default and would, therefore, act in accordance with established procedure toward a country in default. Smith would not go beyond this to explain default, other than to point out embarrassment to Soviets through publicity on matter.
I want the Department’s views on this, together with a statement of just what means are available to the US in the way of pipeline stoppages, recapture of Lend-Lease material, termination of government economic assistance or Trade Agreements, discouragement or denial of financial or sales activities of private US firms, application of the Johnson Act, et cetera.
The information requested above is for my personal use only in making the decision. The publicity attendant to declaration of default is probably the most damaging factor from Soviet viewpoint, but I do not want it based on an empty threat.